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Hard on the heels of announcing a strong March quarter earnings performance, Melbourne-based microbiome health company Biome Australia (ASX: BIO) has shored up its finances with a new $5 million debt facility from National Australia Bank (ASX: NAB) to accelerate its three-year growth plans.
Biome Australia, which is also forecasting a full-year profit for the first time in FY25, says the new loan agreement will replace an existing $1.2 million revolving debt facility secured with Tradeplus24 in 2023 at a “significantly improved interest rate”.
Under the agreement, NAB is providing a $3.5 million invoice financing facility at an interest rate of 7.75 per cent and a $1.5 million trade refinance facility at 7.53 per cent. The interest rates compare with the Tradeplus24 facility’s annual interest rate of 10.6872 per cent.
The refinancing deal follows a strong run of growth for Biome Australia which in February reported a maiden profit in the first half of FY25, running ahead of schedule in its three-year strategy to deliver cumulative revenue of up to $85 million by 2027.
Biome yesterday posted unaudited sales revenue of $4.5 million for the March quarter, which was up 41 per cent compared to a year earlier taking the running total for the first nine months of the year up 46 per cent from a year earlier.
The company says the latest result sets the company up well for the fourth quarter, which is traditionally its strongest seasonal growth period of the year.
Biome Australia produces and markets a range of live probiotics that help prevent and support the management of health concerns, including low mood and sleep, bone health and cholesterol.
While Australia is Biome’s primary market with a footprint of 6,000 pharmacy and practitioner distribution points, the company is also making headway in the UK and Canada.
Biome Australia’s chief financial officer Douglas Loh says the refinancing deal with NAB signals a new partnership with the bank’s NAB Health division.
“NAB’s specialty healthcare department has a deep understanding of the Australian health industry, and their backing is a significant validation of the Biome Australia business,” says Loh.
“As we continue to expand Biome internationally, we look forward to working closely with the NAB Health team to support our growth capital needs.”
Biome, which was founded in 2018 by Blair Norfolk who is listed among this year's Top 100 Young Entrepreneurs, has expanded its operations into four countries with the latest quarterly revenue total pushing the company past its FY24 full-year revenue of $13.01 million.
While March quarter revenue was up 41 per cent compared to a year earlier, Norfolk noted yesterday that same-store sales were up 45 per cent from December to February.
“March quarter is seasonally the slowest quarter in the industry, due to reduced trading days as well as pharmacy and practitioner customers being on school holidays,” said Norfolk, the Biome Australia CEO.
“The team and I are thrilled with the steps forward made in Q3 backing up our record quarter in Q2 in less trading days.
“As we enter the June quarter, Biome and our Activated Probiotics are well positioned for significant growth to close the financial year, aiming for our first full year of net profit.”
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